DESPITE many provisions having already come into effect over the past year or so, many businesses are still failing to fully appreciate the implic-ations of the Compan-ies Act 2006 and imple-ment the changes it introduces that could be beneficial to them.
The 2006 Act largely replaces the 1985 Act and is designed to centralise company law legislation, while mak-ing it more user friend-ly for company officers and other users.
The effect of the ap-plication of the 2006 Act is also intended to reflect working practic-es of the modern busi-ness world, enabling companies to remain competitive and responsive to change.
Since its Royal Assent on November 8 last year, the 2006 Act has been phased-in gradually with final stages of rollout taking place in 2008 and 2009.
Although staged implementation provides business owners with greater opportunity to adjust to the new legislation, it has not proven particularly effective in promoting change and understanding.
This is especially true of small to med-ium-sized companies that do not always have dedicated in-house legal resources and expertise to review the provisions of the Act.
The Act is almost 800 pages long, which offers a reason as to why com-panies are not up-to-speed with changes to the law. They need to realise the Act does affect them, and start using its effects, or risk working practices becoming outdated.
DEBRA GRANT is a partner at JST Lawyers.